Call it a pit stop. Or maybe a brief hiatus is a better description. In mid-2012, David Iben suddenly departed the U.S. firm Tradewinds, a subsidiary of Nuveen he had helped run and a firm where he had carved out one of the better value investing track records in the mutual fund industry. Between 2004 and his departure, Nuveen Tradewinds Value Opportunities posted an annualized 10.8% return versus 3.8% for the Russell 3000 Value Index. (The strategy had a longer record in a separate account.) Nuveen Tradewinds Global All-Cap had a similarly impressive record during Iben's six-year tenure.

Iben rode out the market's worst and watched in 2009 as the natural resources holdings surged along with individual positions such as Whole Foods , which almost doubled that year, Tata Motors , eBay , and Tech Data . The fund gained an astounding 50.8% that year, versus 37.4% for the mid-blend peer group. About the only detractors were several holdings in Japan.

That performance didn't go unnoticed. More than $500 million flowed into the fund that year, followed by $782 million and $613 million the next two years. Iben had been running a very nimble fund for most of the 2000s. Now, though, he saw his fund's assets balloon to $3 billion at its peak. On the surface, there seemed to be some apparent side effects of that success. The fund's exposure to large-cap stocks started to increase (50% of assets at the beginning of 2010, according to Morningstar data, versus around 20% in 2006), which in most cases is a sign a manager could be struggling with asset bloat. But Iben says that wasn't the case. Instead, he says he just started finding more value in the large-cap arena. The fund moved into the large-blend category in 2010.

A New Home
With this new fund, Iben hasn't lost his taste for straying from standard benchmarks. Kopernik Global All-Cap's portfolio consists of 65 holdings, with roughly 30% of assets in emerging markets, which is one of the highest emerging-markets exposure ever for an Iben portfolio. (The average world stock fund has just 5% in emerging markets.) Meanwhile, U.S. stocks comprise just 11% of assets. "The U.S. market has had a five-year run." he said, adding, "growing parts of the world are on sale."

As with his other funds, this one has a large exposure--around 40% of assets--to materials and energy stocks. Newcrest Mining , OAO Gazprom , Newmont Mining , and Japan Steel Works are amongst the fund's top holdings as of June 30, 2014. While Iben shies away from making macroeconomic calls, those stocks will be boosted by a strong global economy and a soft landing in China. Iben, though, prefers them for a simpler reason: "We are buying [the commodity in the ground] for less than it sells today," he said.

Investors may need to be patient. The fund's year-to-date performance has bounced between the middle and top quartile of the world-stock category rankings. As of June 30, it had returned 7.4% versus 5.7% for the category average. That gain, though, was largely due to a strong June performance. And judging from his latest shareholder letter, Iben is once again stretching his legs. This time, it seems Russia is one of his favorite hunting grounds, an area many investors have avoided as tensions in Ukraine have elevated.

"Are there problems in Russia? Absolutely," he wrote. "But the opportunity is amongst the best I've encountered in the roughly one-third century that I've been fortunate enough to be in this business." It's unclear if Iben is building the fund's current 15% position in Russia by adding to existing holdings or buying new stocks. The letter mentions a bank, a natural-gas firm, and a hydroelectric company he believes are all trading at deep discounts to book value. Current Russia-based holdings as of June are Gazprom, JSC RusHydro , Sberbank , Protek (a health-care products supplier), and JSCFederal Grid (a utility).

Iben, though, has often enjoyed having shareholders who are willing to stick it out to see his bets come to fruition. His Tradewinds fund never saw a month of net outflows between 2004 and 2011 and the fund's investor returns were typically in the top third of its category, a sign shareholders understood Iben's unique strategy.

Setting Up Shop
Kopernik Global Investors now numbers 34 staff members and is managing more than $1 billion in various products. Many of Kopernik's current employees either worked with Iben at Vinik's firm or followed him to Tampa after leaving Tradewinds. It's a deep bench for such a new firm and one that has invested more than $15 million of its own money in the firm's strategies and products.

For his part, Iben isn't set on creating another Tradewinds that would feature an extensive lineup of offerings. In addition to Kopernik Global All-Cap, the firm is running for private accounts a global unconstrained long/short strategy and a global real-asset product. The long/short strategy looks at under- and overvalued stocks across the market-cap spectrum and throughout various international markets. The real-asset strategy focuses on companies that are in the energy, industrials, materials, utilities, and food products industries. These companies generate at least 50% of their revenue from producing or processing natural resources. This product can invest in both equities and fixed-income securities.

"We are taking what we think are the best products with the best opportunity set," Iben said.

While Iben's new fund is worth a look, there are some details worth keeping a close eye on. The fund is part of a series trust from SEI Investments. So the board overseeing the fund is also monitoring many other funds, too. While Morningstar's fund research team is lukewarm on such a board structure, many smaller funds use series trusts as a way to keep costs down and relieve managers from time-consuming back-office duties.

It will be interesting, though, to see if the board keeps shareholders in mind when it comes to fees. As with many new funds, fees are a bit high. The fund's 1.35% annual expense ratio is slightly above the world-stock category average. It wouldn't be surprising, though, to see the fee come down as assets grow, given some of the language describing expenses in the fund's Statement of Additional Information. There is also a 5.75% sales load. That load likely will be a high obstacle to overcome for many small investors. However, it will also likely keep hot money from flowing into the fund if Iben repeats his past successes.

This article originally appeared in Morningstar magazine. To learn more about Morningstar magazine, please visit our corporate website.

Iben didn't remain idle for long. He moved across the country to Tampa, Fla., from Los Angeles, not to work for a competitor but for Jeffrey Vinik, the prominent former Fidelity manager who had started his own hedge fund firm. Vinik had moved his office south from Boston to be closer to the Tampa Bay Lightning, the National Hockey League team he had purchased in 2010. Taking the role meant Iben pretty much disappeared from the retail investing scene. Meanwhile, Tradewinds was struggling in the wake of his departure. More than $2.5 billion exited the firm's open-end funds in 2012, according to Morningstar data.

It wasn't all smooth sailing for Iben, either. Almost as suddenly as he had departed Tradewinds, Vinik decided to shutter his firm in order to concentrate on running the hockey team. Although surprised by the decision, Iben didn't hesitate with his next move. He and several colleagues quickly moved to start Kopernik Global Investors, which opened its doors on July 1, 2013. The firm's name was borrowed from Nicolaus Copernicus, the 15th Century astronomer and mathematician. Always a contrarian, Iben identified with Copernicus' unorthodox theory: The sun, rather than the Earth, was at the center of the universe. Iben also liked that Copernicus trusted his own observations instead of relying on conventional thinking.

Vinik didn't completely sever his ties with his former colleagues. He loaned the firm $5 million at attractive rates. That working capital partly helped with overhead and hiring. (Iben recruited several outsiders to the firm in addition to hiring 16 of Vinik's 19 employees.) In November, the new firm launched Kopernik Global All-Cap . Vinik was one of its first investors, putting $15 million of his own money in the strategy.

Despite a new town and a new firm, one thing didn't change for Iben: The way he picked stocks. Flexibility has long been his hallmark. Iben has always crafted portfolios without much regard to standard benchmarks. His new fund isn't any different, with its mandate giving him wide latitude to invest across regions, countries, sectors, and the market-cap spectrum. He and his team are traditional value investors, focusing on stocks with competitive advantages, strong or improving fundamentals, and attractive valuations.

"It's in my DNA," said Iben of his strategy. "We view ourselves as appraisers of businesses. Our philosophy is to never pay more for something than its intrinsic worth."

The larger question is whether that process will enable him to quickly pick up where he left off. Many investors have already made up their minds. The fund took in more than $430 million since its launch through May.

"It is an intriguing fund," said Albert Brenner, who helps oversee $5.2 billion as the lead on the asset-allocation strategy at People's United Bank Wealth Management in Bridgeport, Conn. Brenner is keeping the fund on his radar. "We aren't believers in the efficient market hypothesis, and he obviously isn't, either."

Initial Success
Nuveen Tradewinds Value Opportunities had stood out from the beginning. Performance certainly helped. The fund landed in the top quintile of the mid-blend peer group in each of its first six calendar years. But that wasn't the only reason it got noticed. While most peers invested solely in the United States, Iben had as much as a one-third exposure to stocks outside North America. He peppered the portfolio with convertibles. In addition, he built a roughly 30% to 40% exposure to basic materials companies, more than 4 times the peer group average. He eventually shifted from base metals to precious metals. Gold miners he believed were trading for less than their tangible assets were prominent in the top 20 holdings on a regular basis.

"We bought what the market had left behind," Iben said.

Such positioning brings with it certain risk. Commodity prices are prone to swings. And if his big bets went south, the fund likely would be bringing up the back of the pack because the portfolio looked nothing like a typical benchmark or any peers. Indeed, the fund's R-squared, a measure of the percentage of a fund's movements that can be explained by movements in a benchmark index, was routinely in the 50s and 60s, which are low scores. (The average mid-blend fund was in the high 80s; an R-squared of 100 means all of the fund's movements can be explained by the behavior of the index.)

The moves proved prescient. Gold prices were just starting to improve as the U.S. economy recovered from a bear market and investors wanted a hedge against inflation fears. Emerging markets such as China and India were just starting to demonstrate their economic thirst for all kinds of natural resources. In 2006, the fund gained 25.1%, more than 11 percentage points ahead of the mid-blend category. AGCO , Bema Gold, Lihir Gold, and Maxtor were among the fund's top performers that year.

While the fund's early performance was above average, it was the housing bust and the subsequent downturn where Iben excelled. He had kept the fund's exposure to what he thought were overvalued financials to less than 5% of the portfolio heading into 2007. The fund's average peer had 4 times that amount. As the market started turning south, that lack of exposure insulated the fund. Iben then stood by his materials positions and began buying or adding to energy stocks, especially coal producers such as Arch Coal and Peabody Energy that were enjoying higher sales as Chinese demand surged. While some of those holdings cooled off in the second half of 2008, the underweight to financials and health-care holdings such as Amgen helped the fund post a 32% loss that year. That loss was 7 percentage points less than the mid-blend average.